Blossom's Flowers Purchases Roses for Sale for Valentine's Day

question 39

Multiple Choice

Blossom's Flowers purchases roses for sale for Valentine's Day.The roses are purchased for $10 a dozen and are sold for $20 a dozen.Any roses not sold on Valentine's Day can be sold for $5 per dozen.The owner will purchase 1 of 3 amounts of roses for Valentine's Day: 100,200,or 400 dozen roses.Given 0.2,0.4,and 0.4 are the probabilities for the sale of 100,200,or 400 dozen roses,respectively,then the expected opportunity loss (EOL) for buying 200 dozen roses is

• A)$1,600.
• B)$1,500.
• C)$700.
• D)$900.

Understand current trends in site selection and their impact on logistics.

Analyze the effects of tapering rates on facility location decisions.

Understand the concepts and differences between "make or buy" decisions and the implications of each.

Recognize the importance of and methods for building strong supplier relationships and the role of suppliers in product design and quality control.

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Definitions:

Hedge Risk

The practice of making investments to reduce the risk of adverse price movements in an asset, typically involving derivatives.

New Securities

Financial instruments that have been recently issued, including stocks, bonds, or other financial assets available for investors to buy.

Transactions Exposure

Refers to the potential for a company's cash flows and thus its market value to change due to a change in exchange rates.

Swap Contract

A financial agreement where two parties agree to exchange the cash flows or liabilities from two different financial instruments.